Citi Imposes Foreclosure Moratorium

Following suit behind other national lenders such as ""Bank of America"":http://dsnews.comview_story.cfmxid=2974 and ""JPMorgan Chase"":http://dsnews.comview_story.cfmxid=3109, ""Citigroup"":http://www.citigroup.com said on Monday that it is stopping foreclosures on borrowers who occupy their property as a principal residence and have enough income to keep up lower, renegotiated mortgage payments. The New York-based lender said it also has plans to expand the moratorium to include mortgages that it services but does not own, the %{=FONT-STYLE: italic}""Associated Press"":http://www.associatedpress.com% reported.
In addition, over the next six months, Citi said it will contact 500,000 borrowers who are at risk of soon becoming delinquent to see if a more sustainable loan modification can be reached. This number represents about one-third of all the mortgages that Citigroup owns, the bank said. The %{=FONT-STYLE: italic}Associated Press% said that Citi plans to devote a team of 600 salespeople to assist the targeted borrowers by adjusting their rates, reducing principal, or increasing the term of the loan.
The bank's new program is called the Citi Homeowner Assistance Program, and is expected to provide relief for some $20 billion in mortgage loans, or 130,000 homeowners, Citi explained. The modification program is limited to borrowers whose mortgage payment is more than 40 percent of their income. CitiMortgages CEO Sanjiv Das told %{=FONT-STYLE: italic}""CNN"":http://www.cnnmoney.com% that the company was reaching out to borrowers in ""areas of steeper-than-usual falling prices and higher-than-average unemployment ... where the concentration of at-risk mortgages are the highest,"" including California, Michigan, Florida, Nevada, Ohio, and Arizona.